The county court has granted solicitors an interim costs order in a long-running case where the level of damages was still three years from being finalised.
The order of His Honour Judge Robinson in I v Hull & East Yorkshire Hospitals NHS Trust will be hailed by claimant lawyers who may otherwise face years out of pocket despite having secured admissions of liability.
The judge said it was a ‘virtual certainty’ the claimant would be entitled to his costs, and the court should be mindful of the costs incurred since making its liability order in 2012.
‘Failure to ensure adequate cash flow during the period of inevitable delay may lead to the perverse and undesirable consequence that solicitors are unwilling to take on a case such as this at an early stage,’ said the judge. ‘It is in everyone’s interests to determine liability as early as possible. But if the consequence is that solicitors must then fund the quantum investigation for 10 years of more, they may not be anxious to take the case on early.’
This case concerned an appeal by the claimant against a costs order made by District Judge Batchelor in September 2017. The issues were whether the court had the power to make an interim costs order and whether it should exercise that power.
The underlying case was a clinical negligence claim from an 11-year-old following a catastrophic birth injury, with £1.2m damages already paid on account.
More than six years ago, the court approved the liability settlement, giving judgment for 90% of the value of the claim, also ordering the defendant pay the claimant’s reasonable costs to date, subject to detailed assessment. An interim costs payment of £100,000 was made, along with a further voluntary payment of £115,000.
It is now agreed that the full value of the claim cannot be quantified until 2022. The defendant said there was no precedent for the claimant to be entitled effectively to quantum costs before quantum had been resolved. Even if most of the interim payments have gone to one firm and not the other, this was no reason to overlook the normal rules. Total incurred costs are estimated at around £700,000.
The claimant’s solicitors argued it could not be right they should foot the costs of their own legal advice and experts where the defendant had admitted liability. This was identified as the ‘dreadfully out of pocket’ test.
The judge said even if costs are not to be assessed by the detailed procedure until the conclusion of proceedings, the court may order them to be assessed immediately. In this case the court could order a payment on account of costs.
The judge said there was ‘no danger’ of claimant lawyers being overpaid, as undue risks were not likely to be taken by experienced solicitors and counsel. He ordered that the defendant pay a further £150,000 on account.
Source: The Law Society Gazette